Efficiency and Profitability: How HIVERY Curate Optimizes SKU Rationalization
In the fast-paced world of retail, optimizing your product assortment is not just a matter of convenience; it's a critical component of staying competitive and profitable. One of the challenges that retailers and consumer packaged goods (CPG) manufacturers face is determining which products to keep on the shelves and which to remove. This process, known as SKU rationalization, can significantly impact a company's efficiency and profitability.
Traditionally, SKU rationalization has been a complex and time-consuming task, often relying on manual analysis, historical sales data, and educated guesswork. However, this process has been revolutionized with advanced analytics and AI-driven solutions like HIVERY Curate, leading to more efficient and profitable outcomes.
Why SKU Rationalization Matters
SKU rationalization involves evaluating the performance of individual Stock Keeping Units (SKUs) and deciding which ones to retain, discontinue, and introduce new ones. The goal is to optimize the product assortment to meet customer demand while reducing costs, minimizing inventory, and maximizing profitability.
Efficient SKU rationalization has several significant advantages:
- Cost Reduction: By eliminating underperforming SKUs, companies can reduce inventory carrying costs, storage space requirements, and associated operational expenses.
- Improved Customer Experience: Focusing on top-performing SKUs ensures customers can find their preferred products in stock, leading to better customer satisfaction.
- Streamlined Operations: A leaner product assortment simplifies supply chain management, reducing complexity and making it easier to meet demand accurately.
- Enhanced Profitability: Rationalizing SKUs allows companies to allocate resources more effectively and invest in products that generate higher margins.
The HIVERY Curate Advantage
HIVERY Curate takes SKU rationalization to the next level by leveraging AI and advanced analytics to provide data-driven insights and recommendations. Here's how it works:
- Data Integration: HIVERY Curate ingests and analyzes a wealth of data, including historical sales data, store-level data, and even planograms when available. This comprehensive data pool forms the foundation for SKU rationalization.
- Machine Learning Models: The platform utilizes machine learning models to assess the performance of each SKU, considering various factors such as sales trends, seasonality, and market dynamics.
- Real-time Insights: With HIVERY Curate, companies can access real-time insights into SKU performance, allowing for agile decision-making based on the latest market conditions.
- Scenario Planning: Businesses can simulate various scenarios and strategies, such as discontinuing specific SKUs or expanding distribution, to understand the potential impact on profitability and efficiency.
- Customization: HIVERY Curate tailors its recommendations to align with a company's brand portfolio and retailer goals, ensuring that decisions are optimized for specific business objectives.
Case Study: A US Retail Giant's SKU Reduction Goal
One of the largest retailers in the United States faced a challenge: a company-wide goal to reduce SKUs by 10%. This reduction was intended to streamline operations and cut costs. However, the retailer sought to achieve this goal while minimizing the impact on product availability and customer satisfaction.
HIVERY Curate was brought in to address this challenge. Using its powerful AI algorithms and data-driven insights, HIVERY Curate analyzed the retailer's extensive SKU portfolio, considering factors such as sales performance, seasonality, and market demand.
Through a combination of precise data analysis and scenario planning, HIVERY Curate devised a strategy that reduced the impact of the SKU reduction goal to just 3%. This meant the retailer could meet its cost-cutting objectives while maintaining a robust product assortment catering to customer preferences.
Unlocking Efficiency and Profitability
HIVERY Curate's SKU rationalization capabilities unlock newfound efficiency and profitability for retailers and CPG manufacturers. It empowers decision-makers with data-driven insights, reduces the guesswork, and enables them to make informed choices about their product assortment.
In a rapidly evolving retail landscape, staying competitive requires a smart and adaptive approach to SKU rationalization. HIVERY Curate streamlines the process and ensures that companies can consistently deliver the right products to their customers while maximizing their bottom line. By harnessing the power of AI and advanced analytics, businesses can make SKU rationalization a strategic advantage in their pursuit of efficiency and profitability.
Experience the power of HIVERY Curate for yourself. Request a demo today and discover how HIVERY Curate can revolutionize your role and category.